<PAGE>
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 FOR THE QUARTER ENDED JUNE 30, 1999
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR TRANSITION PERIOD FROM TO .
Commission file number 1-11064
BRITESMILE, INC.
...............................................
(Exact name of small business issuer as specified in its charter)
UTAH 87-0410364
...................... ...............
(State or other jurisdiction (IRS Employer
of Incorporation or Organization) Identification No.)
Airport Business Center
200 Diplomat Drive, Suite 204
Lester, Pennsylvania 19113
...............................................
(Address of principal executive offices with Zip Code)
(610) 362-1111
..................
(Issuer's telephone number)
...............................................
(Former name, former address and former fiscal year, if changed since last
report)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes [X] No [ ]
The number of shares of common stock of the Registrant outstanding as of
June 30, 1999 was 18,512,409.
1
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PART I - FINANCIAL INFORMATION
PAGE NO.
--------
Item 1 - Financial Statements
Condensed Consolidated Balance Sheets
June 30, 1999 and March 31, 1999 3
Condensed Consolidated Statements of Operations
Three Months Ended June 30, 1999 and 1998 5
Condensed Consolidated Statements of Cash Flows
Three Months Ended June 30, 1999 and 1998 6
Notes to Condensed Consolidated Financial Statements
June 30, 1999 7
Item 2 - Management's Discussion and Analysis of Financial
Condition and Results of Operations 8
PART II - OTHER INFORMATION
Item 1 - Legal Proceedings 12
Item 2 - Changes in Securities 12
Item 3 - Defaults Upon Senior Securities 12
Item 4 - Submission of Matters to a Vote of
Security Holders 12
Item 5 - Other Information 12
Item 6 - Exhibits and Reports on Form 8-K 12
SIGNATURES 13
EXHIBITS 14
2
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ITEM I. FINANCIAL STATEMENTS
BRITESMILE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(amounts in thousands)
<TABLE>
<CAPTION>
June 30, 1999
(Unaudited) March 31, 1999
-------------- --------------
<S> <C> <C>
Assets
Current assets:
Cash and cash equivalents $15,891 $6,200
Accounts receivable, less allowance
of $ 273 117 75
Inventories 64 16
Prepaid expenses 242 329
Assets held for sale -- 1,250
------- ------
Total current assets 16,314 7,870
------- ------
Property and equipment, net 3,523 2,522
Other assets 90 40
------- ------
Total assets $19,927 $10,432
======= ======
</TABLE>
SEE ACCOMPANYING NOTES.
3
<PAGE>
BRITESMILE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (CONTINUED)
(amounts in thousands, except per share data)
<TABLE>
<CAPTION>
June 30, 1999
(Unaudited) March 31, 1999
------------- --------------
<S> <C> <C>
Liabilities and shareholders' equity
Current liabilities:
Notes payable $ 65 $ 69
Accounts payable 613 2,032
Accrued liabilities 1,637 1,474
Mortgage obligations and other debt -- 797
-------- --------
Total current liabilities 2,315 4,372
-------- --------
Shareholders' equity:
Common stock, $.001 par value:
Authorized shares - 50,000
Issued and outstanding shares -
18,512 and 17,138 at June 30, 1999
and March 31, 1999, respectively 19 17
Additional paid-in capital 42,898 27,821
Accumulated deficit (25,305) (21,778)
-------- --------
Total shareholders' equity 17,612 6,060
-------- --------
Total liabilities and shareholders' equity $ 19,927 $ 10,432
======== ========
</TABLE>
SEE ACCOMPANYING NOTES.
4
<PAGE>
BRITESMILE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(amounts in thousands, except per share data)
<TABLE>
<CAPTION>
Three months ended
------------------
June 30, June 30,
1999 1998
---------- ----------
<S> <C> <C>
Net whitening fees $ 874 $ --
Net product sales -- 360
---------- ----------
Total net sales 874 360
Cost of sales:
Whitening center expenses 853 --
Product sales -- 282
Inventory write-downs -- 354
---------- ----------
Total cost of sales 853 636
Gross margin 21 (276)
Selling and administrative expenses 3,328 880
Research and development expenses 291 239
Termination benefits, impairment charges
and write-down of assets -- 737
---------- ----------
Operating loss (3,598) (2,132)
Interest income and other 71 17
---------- ----------
Loss before income taxes (3,527) (2,115)
Income taxes -- --
---------- ----------
Net loss $ (3,527) $ (2,115)
========== ==========
Net Loss per common share -
basic and diluted $ (.20) $ (.30)
Basic and diluted weighted average common
shares outstanding 17,537 6,975
</TABLE>
SEE ACCOMPANYING NOTES.
5
<PAGE>
BRITESMILE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(amounts in thousands)
<TABLE>
<CAPTION>
Three months ended
-----------------
June 30, June 30,
1999 1998
--------- ---------
<S> <C> <C>
Cash Flows From Operating Activities:
Net loss $(3,527) $(2,115)
Adjustments to reconcile net loss to net cash
used in operating activities:
Depreciation and amortization 155 41
Termination benefits, impairment charges and
write-down of assets -- 633
Stock option compensation cost 55 --
Changes in current assets and liabilities:
Accounts receivable, inventory and prepaid expenses (3) 15
Accounts payable and accrued liabilities (322) (50)
Other (50) --
------ ------
Net cash used in operating activities (3,692) (1,476)
------ ------
Cash Flows from Investing Activities:
Additions to property and equipment (2,090) --
Net proceeds from sale of assets 1,250 --
Other -- (9)
------ ------
Net cash used in investing activities (840) (9)
------ ------
Cash Flows From Financing Activities:
Principle payments on borrowings (801) (103)
Proceeds from sale of common stock and
exercise of stock options 15,024 5,000
------ ------
Net cash provided by financing activities 14,223 4,897
------ ------
Net increase in cash and cash equivalents 9,691 3,412
Cash and cash equivalents at beginning of period 6,200 503
------ ------
Cash and cash equivalents at end of period $15,891 $ 3,915
====== ======
</TABLE>
SEE ACCOMPANYING NOTES.
6
<PAGE>
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
June 30, 1999
(amounts in thousands, except per share data)
1. ACCOUNTING POLICIES
Basis of Presentation
- -----------------------
The unaudited, condensed consolidated financial statements of BriteSmile, Inc.
(the "Company")as of June 30, 1999 and for the three months ended June 30, 1999
and 1998 have been prepared in accordance with generally accepted accounting
principles for interim financial information and in accordance with the
instructions to Form 10-QSB and rules promulgated by the Securities and Exchange
Commission. The consolidated financial statements include the accounts of the
Company, its subsidiaries, and entities in which the Company has a controlling
financial interest. All intercompany balances and transactions have been
eliminated in consolidation. Certain information and footnote disclosures
normally included in financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted pursuant to such
rules and regulations. In the opinion of management, all adjustments considered
necessary to present fairly the financial position, results of operations and
cash flows of the Company, have been included. The results of operations for the
periods presented are not necessarily indicative of the results for the
respective complete years. For further information, refer to the consolidated
financial statements and the notes thereto included in the Company's annual
report on Form 10-KSB for the year ended March 31, 1999.
Earnings Per Share
- --------------------
Earnings per share is computed based on the weighted average number of shares of
common stock and common stock equivalent shares outstanding during each period.
Because the Company reported a net loss for each of the periods ended June 30,
1999 and 1998, all common stock equivalents are anti-dilutive and accordingly,
have been excluded from the earnings per share computations. As a result, the
numerator or net loss and the denominator or weighted average number of common
shares are the same for both basic and diluted earnings per share computations.
2. PRIVATE PLACEMENT
In June 1999, the Company completed a private placement of 1,356 shares of its
common stock for $15,000. 1,004 shares were sold to private investors, and the
remaining 352 were sold to a group of individuals, including members of senior
management, the Company's Board of Directors and key consultants ("Management
Purchasers")
Pursuant to Registration Rights Agreements entered into with the Company, the
non-Management Purchasers acquired certain rights to cause the Company to
register their shares for offer and sale under the Securities Act of 1933, as
amended ("the Piggyback Registration Rights").
Pursuant to Amended and Restated Registration Rights Agreements entered into
between the Company and the Management Purchasers, the Management Purchasers
acquired Piggyback Registration Rights, and also certain limited demand
registration rights.
7
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
THIS QUARTERLY REPORT ON FORM 10-QSB CONTAINS, IN ADDITION TO HISTORICAL
INFORMATION, FORWARD-LOOKING STATEMENTS THAT INVOLVE SUBSTANTIAL RISKS AND
UNCERTAINTIES. THE COMPANY'S ACTUAL RESULTS COULD DIFFER MATERIALLY FROM THE
RESULTS ANTICIPATED BY THE COMPANY AND DISCUSSED IN THE FORWARD-LOOKING
STATEMENTS. FACTORS THAT COULD CAUSE OR CONTRIBUTE TO SUCH DIFFERENCES ARE
DISCUSSED BELOW IN THE SECTION ENTITLED "FORWARD-LOOKING STATEMENTS."
RESULTS OF OPERATIONS
In April 1998, the Company changed its strategic direction and focused its
resources on the dental whitening market. The Company had previously been
engaged in the manufacture and sale of industrial and scientific lasers, as well
as the sale of teeth whitening chemicals and laser-based teeth whitening
devices. As the Company focused its efforts on the dental whitening market and
the development of new teeth whitening technology, it discontinued the
production and sale of its laser-based device and both in-office and take-home
teeth whitening chemical products.
In February 1999, the Company introduced a new Light-Activated Teeth Whitening
System, "LATW" (patents pending), including its new whitening device, the
BriteSmile 2000, its new whitening gel, and new whitening process. The LATW was
introduced in Walnut Creek, California at the first retail salon setting known
as a BriteSmile Professional Teeth Whitening Center ("Centers"). In March 1999
the Company opened its first BriteSmile Professional Teeth Whitening Associated
Center ("Associated Centers") in Louisville, Kentucky. Unlike the stand-alone
Centers, the Associated Centers are located in an existing premier cosmetic
dental practice. Each center is professionally operated by a licensed dentist
and offers the Company's newest technology. As a result of these changes the
Company's sales have shifted from product revenues to service revenues.
During the three months ended June 30, 1999, the Company continued to open
Centers and Associated Centers. As of June 30, 1999, the Company had 4 Centers
and 6 Associated Centers in operation.
THREE MONTHS ENDED JUNE 30, 1999 (FISCAL 2000) COMPARED TO
THREE MONTHS ENDED JUNE 30, 1998 (FISCAL 1999)
Amounts presented within this Management's Discussion and Analysis of Financial
Condition and Results of Operations are in thousands.
Net Sales
- -----------
Sales for the first quarter ended June 30, 1999 totaled $874, compared to $360
for same period in the prior year, representing an increase of $514 or 143%.
Product sales, related to the Company's former product lines, declined 100% as a
result of the Company's discontinuation of laser-based teeth whitening devices
and related chemical products during fiscal 1999. All consolidated revenues for
the quarter ended June 30,1999 were derived from teeth whitening fees. Teeth
whitening fees are expected to increase over the next three quarters of fiscal
2000 as a result of the opening of additional Centers and Associated Centers,
and increased consumer awareness of BriteSmile Whitening services.
Cost of Sales
- ---------------
Cost of sales, exclusive of inventory write-downs, for the three months ended
June 30, 1999 increased to 98% of net sales from 78% in the same period of the
prior year. The increase is due to the low operating levels during the start-up
phase of the Centers and Associated Centers, and the lack of laser device and
chemical product sales which were discontinued during the second fiscal quarter
of the prior year.
Selling & Administrative Expenses
- -----------------------------------
Selling and administrative expenses in the three months ended June 30, 1999
increased to $3,328 from $880 in the same period of the prior year, or $2,448.
The increase is primarily due to the intoduction and operation of the Centers
and Associated Centers. Included in the selling and administrative expenses for
the three months ended June 30, 1999 were $1,773 of advertising, promotional and
call center costs directed to increase consumer awareness and sales of the
whitening service. In addition, $532 of professional services costs related to
selling and administrative activities were incurred during the three months
ended June 30, 1999 associated with executing Center and Associated Center
agreements, executing leases, intellectual property, legal proceedings and
general corporate matters.
8
<PAGE>
Research and Development Expenses
- ---------------------------------
Research and development expenses for the three months ended June 30, 1999 are
significantly less than the spending levels of the prior three quarters,
reflecting the completion of development of the LATW system during fiscal 1999.
The Company plans to continue research and development efforts to enhance the
capabilities of its technology.
Termination Benefits, Impairment Charges and Write-Down of Assets
- -----------------------------------------------------------------
During the three month period ending June 30, 1998, the Company recorded $1,091
in termination, impairment charges and write-down of assets related to the
discontinuation of activities associated with the laser-based and chemical
product business.
Income Taxes
- --------------
Due to its operating loss, the Company had no income tax expense during the
three months ending June 30, 1999 or 1998. Furthermore, no income tax benefit
was recognized due to the uncertainty associated with the Company's ability to
realize its deferred tax assets, comprised primarily of net operating loss
carryforwards.
Inflation
- -----------
The Company actively strives to contain costs on parts from suppliers by
renegotiating purchase order contracts. Inflation has not been a major factor
in the past and is not seen as a major factor that will impact the Company's
operations in the immediate future.
Net Loss
- -------------------
The Company incurred net losses of $3,527 and $2,115 for the three month periods
ending June 30, 1999 and 1998, respectively. The $1,412 increase in loss is
principally attributable to the increased selling and administrative expenses
related to introduction and operation of Centers and Associated Centers.
9
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
The Company's financing activities resulted in an increase in cash of $14,223
during the three month period ended June 30, 1999, due principally to the
$15,000 of equity capital raised in June 1999. This increase was partially
offset by the $3,692 of cash used by operating activities and $840 of cash used
in investing activities, resulting in a net increase in cash of $9,691 during
the three months ended June 30, 1999. The capital spending represents the
investment in leasehold improvements and equipment for Whitening Centers. The
cash operating losses are principally attributable to selling, administrative
and research and development costs associated with operating and expanding the
business.
In this section, the term "Current Ratio" means current assets divided by
current liabilities. "Working Capital" means current assets less current
liabilities.
The Company's Current Ratio and Working Capital at June 30, 1999 and March
31, 1999 were as follows:
<TABLE>
<CAPTION>
June 30, 1999 March 31, 1999
----------------- --------------
<S> <C> <C>
Current Ratio 7.05 1.80
Working Capital $13,999 $3,498
</TABLE>
In April 1999, the Company sold the building and land, formerly used as its
corporate headquarters in Salt Lake City, Utah and classified as held for sale
in the March 31, 1999 consolidated balance sheet. The net proceeds from the sale
of $1,250 ($1,385 selling price less fees and commissions) were primarily used
to repay the outstanding mortgages on the property totaling $797.
In June 1999, the Company completed a private placement of 1,356 shares of its
Common stock in which it obtained proceeds of $15,000. The proceeds from the
sale of the Common stock will be used by the Company to fund current operations
as well as the planned openings and operations of Centers and Associated
Centers.
The Company is in the early stages of opening Whitening Centers and Associated
Centers. As of August 12, 1999 the Company has opened 5 Whitening Centers and 7
Associated Centers. The Company expects to open additional Whitening Centers and
Associated Centers by the end of fiscal 2000. The Company's opening of
additional centers is contingent upon several factors, including available cash
resources and acceptance by the consumer of the Company's service, among other
items. Currently, the Whitening Centers and Associated Centers which are open
are operating at a loss, which the Company expects will continue throughout much
of fiscal 2000. The Company expects capital expenditures to be approximately
$10,000,000 for its fiscal year ending March 31, 2000. The expenditures are
expected to be used primarily for the opening of Whitening Centers. The Company
believes that cash on hand at June 30, 1999 and cash flows derived from
whitening fees will be sufficient to fund the operations of the existing centers
and fund the Company's expansion plans for the next twelve months. As indicated
above, the Company has a stated plan of opening Whitening Centers and Associated
Centers; however, the Company will only be able to meet its anticipated growth
plans to the extent it has sufficient available cash, and additional funding
sources may be needed. There can be no assurance that such funding sources will
be available to the Company.
Year 2000
Many computer systems experience problems handling dates beyond the year 1999.
This is referred to widely as the "Year 2000" issue. Some computer programs or
computer hardware may recognize a date using "00" as the year 1900 rather than
the year 2000. This could result in a system failure or miscalculations causing
disruption of operations, including, among other things, a temporary inability
to conduct normal business activities, including processing transactions,
sending invoices, and remitting payments.
Based on assessments, the Company has replaced or is in the process of modifying
or replacing portions of its software and hardware so that those systems will
properly utilize dates beyond December 31, 1999. The Company presently believes
that with modifications or replacements of existing software and certain
hardware, the Year 2000 Issue can be mitigated. However, if such modifications
and replacements are not made, or are not completed timely, the Year 2000 Issue
could have a material impact on the operations of the Company.
The Company's plan to resolve the Year 2000 Issue involves the following four
phases: assessment, remediation, testing and implementation. As a result of the
Company's focus on the BriteSmile 2000 system and elimination of previous
business lines, much of the hardware and software currently installed or in the
process of being installed at Company locations is new and is already Year 2000
compliant. The two major internal systems the Company uses include the financial
system and the new call tracking, scheduling, and client payment system. Both of
these systems have been assessed as Year 2000 compliant. The Company plans to
complete testing of these systems by September 30, 1999 to verify their state of
readiness for the year 2000. Preparation of the Company's older personal
computers and servers to become Year 2000 compliant is 80% complete, with the
balance to be completed by October 31, 1999. The Company is assessing and
testing its office equipment, including telephone systems, and expects to have
all systems Year 2000 compliant or replaced by October 31, 1999. A review of the
BriteSmile 2000 device indicates that this significant Company product is Year
2000 compliant.
In addition, the Company has gathered information about the Year 2000 compliance
status of its significant suppliers and continues to monitor their compliance.
The Company has questioned its significant suppliers, including its banks,
merchant service providers, insurance carriers, key vendors and subcontractors,
regarding their Year 2000 readiness. To date the Company is not aware of any
external agent with a Year 2000 issue that would materially impact the Company's
results of operations, liquidity, or its capital resources. However, the
Company has no means of ensuring that such third party suppliers and agents will
be Year 2000 ready. The inability of external agents to complete their Year
2000 resolution process in a timely fashion could materially and adversely
affect the Company.
The Company has used external and internal resources to test and implement
software and operating equipment for Year 2000 modifications. Due to the
limited number of older systems still in use by the Company, the cost of Year
2000 compliance has not been material, nor is it expected to be material to
complete the remaining assessment, testing and implementation tasks.
Management of the Company believes it has an effective program in place to
resolve the Year 2000 issue in a timely manner. As noted above, the Company has
not completed all necessary phases of its Year 2000 program. In the event that
the Company does not complete any additional phases, and one or more of the
Company's or key vendors' critical systems is defective in the year 2000, the
Company may experience difficulties or be unable to process customer telephone
inquiries, collect and process payments for whitening procedures performed, make
payments to employees and vendors, and generally process recurring transactions.
In addition, disruptions in the economy generally resulting from Year 2000
issues
10
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could also materially adversely affect the Company.
The Company has contingency plans for certain critical applications and is
working on contingency plans for less critical applications. These contingency
plans principally involve manual workarounds.
Forward-Looking Statements
The statements contained in this Report that are not purely historical are
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995 and Section 21E of the Securities Exchange Act.
These statements relate to the Company's expectations, hopes, beliefs,
anticipations, commitments, intentions and strategies regarding the future.
They may be identified by the use of words or phrases such as "believes,"
"expects," "anticipates," "should," "plans," "estimates," and "potential," among
others. Forward-looking statements include, but are not limited to, statements
contained in Management's Discussion and Analysis of Financial Condition and
Results of Operations regarding the Company's financial performance, revenue and
expense levels in the future and the sufficiency of its existing assets to fund
future operations and capital spending needs. Actual results could differ
materially from the anticipated results or other expectations expressed in such
forward-looking statements. The Company believes that many of the risks set
forth here and in the Company's SEC filings are part of doing business in the
industry in which the Company operates and competes and will likely be present
in all periods reported. The forward-looking statements contained in this Report
are made as of the date of this Report and the Company assumes no obligation to
update them or to update the reasons why actual results could differ from those
projected in such forward-looking statements. Among others, risks and
uncertainties that may affect the business, financial condition, performance,
development, and results of operations of the Company include:
. government regulation of the Company's products and teeth whitening
procedures, including: (i) current restrictions or controls on the
practice of dentistry by general business corporations, and (ii) future,
unknown enactments or interpretations of current regulations which could,
in the future, affect the Company's operational structure and
relationships with licensed dentists.
. failure of the Company to generate, sustain or manage growth, including
failure to develop new products and expand Center and Associated Center
locations;
. the loss of product market share to competitors and/or development of new
or superior technologies by competitors;
. ongoing operating losses associated with the Company's abandonment of its
industrial laser product line and laser-based teeth whitening
technologies, in favor of development of new, light-activated teeth
whitening technologies;
. failure of the Company to secure additional financing to complete its
aggressive plan for the roll-out of a broad base of teeth whitening
centers nationwide;
. unproven market for the Company's new whitening products, whitening
process, and "whitening center" and "associated center" concepts, in
light of competition from traditional take-home whitening products and
bleaching tray methods.
. lack of diversity of products.
11
<PAGE>
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
There are no new legal proceedings involving the Company or any of its
directors, officers or affiliates, nor any material developments with respect to
pending legal proceedings, which are required to be discussed in this Report.
ITEM 2. CHANGES IN SECURITIES.
Effective June 4, 1999, the Company issued 1,355,555 shares ("New Shares") of
common stock in a private placement, resulting in aggregate proceeds of
$15,000,000 to the Company. 1,004,043 of the New Shares were issued to nine
private investors, including LCO Investments Limited, the Company's largest
shareholder, for aggregate proceeds of $11,120,000. The remaining 351,512 New
Shares were sold to a group of the 18 individuals, including members of senior
management, the Company's Board of Directors, and key consultants, resulting in
total proceeds of $3,880,000. See the Company's Current Report on Form 8-K dated
June 4,1999, as filed with the Securities and Exchange Commission on June 21,
1999, and Item 1, "Description of Business - Recent Business Developments," and
Item 5, "Market for Common Equity - Recent Sales of Unregistered Securities," of
the Annual Report on Form 10-KSB of the Company filed on July 2, 1999.
During the period covered by this report, the Company granted options to
purchase 718,500 shares of Company Common Stock to certain employees, directors,
or key consultants, pursuant to the Company's 1997 Stock Option and Incentive
Plan. The exercise price of all options granted equalled the fair market value
of the Company's Common Stock on the date of grant. Pursuant to a Registration
Statement on Form S-8 filed with the SEC on July 2, 1999, the Company registered
all shares of Common Stock to be issued under its 1997 Stock Option and
Incentive Plan.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES. None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. None
ITEM 5. OTHER INFORMATION.
On July 23, 1999, Peter Schechter was appointed to the Company's Board of
Directors. Peter Schechter is a partner in the public relations firm of Chlopak,
Leonard, Schechter and Associates. Mr. Schechter's appointment increases the
size of the Company's Board to eight.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(A) EXHIBITS
Exhibit No. Description
----------- -----------
3.03 Amendment to Bylaws adopted July 23, 1999.
27 Financial Data Schedule for June 30, 1999 Form 10-QSB.
(B) REPORTS ON FORM 8-K
During the quarter for which this report is filed, the Company filed one
Current Report on Form 8-K dated June 4, 1999. Pursuant to Items 5 and 9 of
the Report, the Company reported the closing of a Stock Purchase Agreement
dated as of June 4, 1999 between the Company and certain investors
including independent investors, members of management, and LCO Investments
Limited.
12
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
BRITESMILE, INC.
Date: August , 1999
/s/ Michael F. Bonner
------------------------
Michael F. Bonner
Vice President, Secretary, CFO
13
<PAGE>
Exhibit 3.03
AMENDMENT TO BYLAWS
Pursuant to action taken by the directors of the Company at a Special
Meeting of the Board of Directors held on Friday, July 23, 1999, Section 3.2(a)
of the Bylaws of the Company was amended to read in its entirety as follows:
Section 3.2 Number, Tenure and Qualifications of Directors.
(a) Number. The number of directors of the Corporation shall range from
three to ten, as may be fixed or changed from time to time within the range by
the shareholders or the board of directors. The range in number of directors may
be changed by amending these Bylaws. No decrease in the number of directors may
shorten the term of any incumbent director. (16-10a-803(1),(2))
ADOPTED effective as of the 23rd day of July, 1999 by vote of the
directors of the Corporation.
BRITESMILE, INC.
By: /s/ Michael F. Bonner
----------------------------
Title: Vice President, Secretary, CFO
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAR-31-2000
<PERIOD-START> APR-01-1999
<PERIOD-END> JUN-30-1999
<CASH> 15,891,000
<SECURITIES> 0
<RECEIVABLES> 390,000
<ALLOWANCES> 273,000
<INVENTORY> 64,000
<CURRENT-ASSETS> 16,314,000
<PP&E> 3,923,000
<DEPRECIATION> 400,000
<TOTAL-ASSETS> 19,927,000
<CURRENT-LIABILITIES> 2,315,000
<BONDS> 0
0
0
<COMMON> 19,000
<OTHER-SE> 17,593,000
<TOTAL-LIABILITY-AND-EQUITY> 19,927,000
<SALES> 874,000
<TOTAL-REVENUES> 874,000
<CGS> 853,000
<TOTAL-COSTS> 853,000
<OTHER-EXPENSES> 3,529,000
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 19,000
<INCOME-PRETAX> (3,527,000)
<INCOME-TAX> 0
<INCOME-CONTINUING> (3,527,000)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (3,527,000)
<EPS-BASIC> (0.20)
<EPS-DILUTED> (0.20)
</TABLE>
